Project 10 dollar, AKA: the war on used games

Posted: October 1, 2010 in Rants

So EA and THQ have decided that the used games market is hurting their bottom line so now they’re going to charge for on disk content.

Ridiculous!

These mega-million dollar corporations are trying to steal from us, and I for one won’t take it lying down.

Used game sales do not hurt anyone’s bottom line.  If the game is being sold used, then it has already sold new and the publishers have already made their profit from it.  Nobody has lost anything.  This is not like piracy, where nobody got any money for the product, the product has already been sold and made money.  What these publishers want is to get payed twice for the same physical product and this is stealing.

Software publishers argue that their product is non-degrading, unlike books or cars, and any resale is of a like new product.  I say “hogwash!” you don’t see Universal or Sony going crazy over used CD sales or Warner or 21st Century Fox going nuts over used DVD sales and they’re non-degrading products too.  The issue here isn’t people that deserve to be payed aren’t getting payed, they already did.  The issue here is greed, pure and simple.  They see a market, using their (already sold)  product and they want a cut.  Why?  Because making games, they say, is expensive and they need to recoup costs.

Bullshit!

Ever since Final Fantasy VII and it’s $100,000,000.00 price tag (and subsequent domination of the industry at the time) every publisher is looking for $60,000,000.00 to well over $150,000,000.00 in investments to make games.  Why?  Because people ate up FFVII like hotcakes and it sold like it, so every publisher wants a piece of that pie.  Unfortunately they neglect to make a good game first and most of that money either ends up in the toilet, or the game tanks and there’s no return on investment.  These games need to sell at least 1 million units (or for bigger titles 2-3 million units) in it’s first two weeks in release to make any money.  Any sales after that time frame is merely a bonus on their part. A big title like Call of Duty or Halo is going to easily recoup this investment, but a smaller one like Okami or Darksiders will have a harder time as there isn’t a fanbase already salivating for it.  So it’s a no-brainer to invest ridiculous money on a Halo or CoD game as you will definitely sell enough on the first day to at least break even, but do we really need hundred million dollar games every time?  No, no we don’t.  What happens is publishers see dollar signs from these big-huge games and so they think if they throw money at whatever title is in development at the time it will make more money than if they hadn’t spent beyond their means.  This is called a bad investment and the publishers are doing it every day, and us, the customers are supposed to pay for it.

Not going to happen.

When you buy a game new for $60 a total of $12 goes to the retailer (EB, Best Buy, Walmart, etc), $12 goes to the console manufacturer and $36 goes to the publisher.  Of that $36 a total of $10 goes to the developers and about $9 goes to marketing, what’s left ($17) is profit.  There’s no room in markup for a retailer to sell the game for less.  The only way to do that would be to cut from the $12 the retailer gets per game sold, and no retailer is going to cut from it’s own pocket.  This is why console games cost the same at EB, Best Buy or Walmart, nobody is willing to cut off their nose to spite their face.  Well, except for the publishers…  This also means that games could not be priced lower than $60 as nobody makes enough money that way, so cheaper games is not the solution.

What is the solution then?  Simple business is the solution.  If you’re not making enough of a return on your investment, then don’t invest so much.  It’s a simple solution for a simple problem.  ROI not high enough, lower your investment next time.  Game developers are a creative bunch, they can work around restrictions like less money, for them less memory is a worse situation.  Why not invest as time goes on in development?  Invest a couple hundred thousand for a fun proof of concept then go from there.  If there’s promise, like the game looks fun or is easily marketable then go for it, give them another $200,000.00 to tighten it up, maybe even get to an alpha build then QA and focus test the shit out of it.  If it’s still a viable investment, fork over another hundred grand for them to polish it up, maybe a beta test.  Give plenty of access to the press, hell, let them QA it too, they’re good at games they wouldn’t mind; and there’s your marketing coverage.    Then maybe toss some advance copies of your game to prominent forum goers who are fans of your work and the word will spread by virtual mouth about how cool you are as a developer/publisher, or something…

Why does the customer have to tell you that the reason you’re not making enough money is because you’re spending too much money on crap.  The stock market isn’t going to cut you a cheque for the money you lost investing in shit, so we shouldn’t either.  There’s no difference, a bad investment is a bad investment.  Seriously, spend less fucking money and it won’t hurt so much when your investment turns out to be a bad one.  There’s no reason that every game needs to be some freaking blockbuster with bleeding edge graphics and a John Williams score.  Not every game needs to be Gears of Brown or a futuristic bloom generator where lens flare blinds you in the sun even though you’re not looking through a camera in the game.  World of Goo cost maybe $200,000 to make, Minecraft?  Far less than that.  These are great games that are making great money with little capital invested.   This means a huge ROI and very profitable.  Even if your game doesn’t sell enough to make a huge profit in the first 2 weeks, with a smaller investment you can wait longer for returns.  Putting all your eggs in one basket is stupid, stop doing it.  But most of all: stop punishing the customer for your stupidity.

We’ll only take it for so long, see what happened to comics?  It can happen to you if you don’t pull your heads out of your asses.

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